BACHELOR OF BUSINESS ADMINISTRATION

BUSINESS ADMINISTRATION

FINANCIAL MANAGEMENT

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Stockholders’ equity refers to the assets remaining in a business once all liabilities have been settled.
A
True
B
False
Explanation: 

Detailed explanation-1: -Shareholders’ equity refers to the owners’ claim on the assets of a company after debts have been settled. It is also known as share capital, and it has two components. The first is the money invested in the company through common or preferred shares and other investments made after the initial payment.

Detailed explanation-2: -Shareholders’ equity is the amount that the owners of a company have invested in their business. This includes the money they’ve directly invested and the accumulation of income the company has earned and that has been reinvested since inception.

Detailed explanation-3: -Stockholders’ equity refers to the assets remaining in a business once all liabilities have been settled. This figure is calculated by subtracting total liabilities from total assets; alternatively, it can be calculated by taking the sum of share capital and retained earnings, less treasury stock.

Detailed explanation-4: -Answer and Explanation: A) It shows a company’s stock issuances and dividends paid to shareholders is true of the statement of stockholders’ equity.

Detailed explanation-5: -Shareholder Equity It is also known as net assets since it is equivalent to the total assets of a company minus its liabilities or the debt it owes to non-shareholders. Retained earnings are the net earnings a company either reinvests in the business or uses to pay off debt.

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